If you’ve been stung by VHI increases. Shop around for a better price. The following article is by Dick O’Brien (Sunday Business Post).
Consumers affected by the VHI’s hike in premiums last week should begin shopping around for better alternatives, a health insurance consultant has said.

Aonghus Loughlin, head of healthcare and risk consulting at Towers Watson, said VHI premiums had gone up by such a margin for many customers that better value was likely to be found by changing policies.

‘‘The first thing I’d say to people is that they have to take stock of what is important to them,” Loughlin said. ‘‘If they want to maintain cover in a particular hospital or type of hospital, they need to tell their current provider – and possibly the others – that these are the benefits they want to keep, and ask can they get them at a lower rate.”

Loughlin said that, in general, consumers were likely to be successful in getting what they wanted.

There are now 250 plan options available from the three health insurance providers: VHI, Quinn Healthcare and Aviva.

‘‘It is possible to switch – either with their existing provider or a new insurer – to a plan that will provide the same, if not somewhat better, coverage as they have now for a lower cost,” he said. ‘‘It will take a little bit of research but, once people take the time to decide what’s important to them, they can definitely make savings.”

Loughlin said many of the newer plans were more suitable to consumers than older options.

‘‘The vast majority have added what I would call a guaranteed outpatient element,” he said. ‘‘In the past, on Plan B, if you went to a GP, you paid the bill, and you got something back only when you hit a very high threshold.

These new plans have a €1 excess and guarantee that, on anything over that, clients will get something back. People who have young children or who are accident prone and end up going to the doctor a lot, should consider those plans.”

However, with speculation rife that other health insurers could follow the VHI’s lead and increase premiums, consumers are concerned that, even if they shift to an alternative provider, they could be again hit with price increases. Loughlin said that, while there was always the risk that another provider could also hike prices, they could only do so from the annual renewal date.

‘‘Anybody who renewed on January 1 with the VHI will not be affected by price rises until January next year,” he said. ‘‘You are guaranteed that, at the very minimum, prices won’t go up until renewal.

You can always make the decision to switch again at renewal date.”

Another alternative for those affected by the increase is to opt for a corporate plan.

While these plans are designed for businesses, every health insurance product has to be made available to all consumers.

Consumers could also seek to make their annual renewal early, before the new rises take effect, and thus get a number of months extra at the current price.

The VHI announced last Thursday that it was increasing premiums by between 15 and 45 per cent from February 1. The annual premium for the average family (two adults and two children) will increase by about €331, or €27.60 a month.

The 15 per cent increase will be levied on about 60 per cent of all VHI customers, namely holders of Plan A, Parents & Kids, LifeStage Choices and One plans.

Other VHI plans will be subject to larger increases. Plan B and Plan B Excess will increase by 35 per cent. Plan B Options will see the highest increase of 45 per cent.

Premiums for Plan C will be increased by 25 per cent, while Plans D and E will see a 21 per cent increase.

The current system of health insurance is breaking down. Slowly but surely, since the Supreme Court ruled out the old risk equalisation scheme in 2008, the cracks have widened.

The VHI’s decision to increase prices in away directly aimed at older customers is a clear signal of this.

The system of community rating – that you pay the same price no matter what your age – is under threat.

On a broader level, the crisis raises issues for the entire healthcare system. If fewer people pay for private insurance, then the already-creaking private system will come under further pressure.

Fine Gael and Labour agree that things should be done differently.

They favour a New system of universal health insurance as a key reform of the overall system, though they still have to spell out precisely how this would work and how it would be paid for.

Given the scale of the VHI increases, this will be a significant issue in the general election campaign to come.

Universal health insurance is no panacea. There are basic flaws in our healthcare system – in the way it is organised, in the division of responsibility between the HSE and the Department of Health and in the way money is allocated – which all need to be tackled.

If the new government wants to make real inroads, these will have to be taken on – as will drug costs and the hospital consultants, whose practices and charging structures in many cases still do not deliver value to either the taxpayer or the health insurance customer.

A properly structured health insurance regime can help, by changing incentives and structures, but the real basic work of reform is also essential.

Our healthcare system is funded via two sources – taxation and insurance payments.

The four-year plan agreed with the EU and IMF outlines an agreement for spending which will have to be adhered to.

This means better services can only be paid for in two ways – through higher premiums or through an increase in productivity in the healthcare system.

What a universal insurance system could do is improve the equity in our healthcare system by ending – or lessening – the current public-versus-private divide.

We believe that this would be best achieved by continuing to allow private healthcare insurers to compete with each other, even if this is within a structure where basic packages are available to all citizens.

Fine Gael and Labour need to spell out their plans – and how they will be funded – during the election campaign.

There is no point in introducing a new healthcare system which imposes higher costs on policyholders but does not lead to a better service.

A new health insurance regime can be an important part of the reform process, but promises to save money by cutting down on admin and making the system more efficient need to be clarified.

Anyone in the market for a new life insurance policy could make savings of up to €6000 provided they shop around, according to new research by the Financial Regulator.

It discovered that there were significant variances in the cost of policies over the lifetime of the product.

The regulator advised that giving up smoking would result in the biggest reduction in life insurance premiums and said that anyone who had given up should immediately contact their insurance provider and ask them to review their policy.

The regulator also said that, if an individual’s circumstances had changed-through either switching job or having children-they should review their cover to make sure it was still adequate for their requirements.